Income from land sales for the majority of local Chinese governments dropped in 2021, hitting budgets at the same time as Beijing has pushed for more spending to fight a housing-market slowdown, reports Caixin. Thirteen of China’s 31 provinces recorded declines of more than 20% in income from selling land-use rights in 2021 from a year earlier.
Ten other provinces had decreases of 20% or less, and six provinces, including Beijing, Shanghai, and Zhejiang, reported rising revenue from land sales. There was no information on two provinces. Yunnan in the southwest achieved 19% of its sales target for the year, and some other provinces were also well below target.
The declines show how the property market’s problems are affecting local governments, with the plunge in home sales since the second half of last year and the cash crisis at some real-estate enterprises making developers reluctant or unable to replenish their land holdings. This in turn could undercut China’s plan to speed up fiscal spending and front-load infrastructure investment this year to stabilize the economy.